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EGBs-GILTS CASH CLOSE: German Short End Outperforms Amid Broader Weakness

BONDS

German bonds outperformed through the 10Y segment while the UK long end outperformed Thursday.

  • High German state inflation triggered Bund losses early, which carried through to on the national September CPI release in the afternoon coming in at 10% Y/Y vs expectations of 9.5% coming into the session.
  • Several ECB speakers reiterated that a 75bp hike was likely in October, though the terminal rate dipped 3bp to the lowest since Sep 23 under 2.90% and Schatz outperformed.
  • Long-end Gilt yields fell sharply alongside a GBP rebound on news that the OBR could get a full fiscal forecast by end-Oct. The BoE's bond buying op saw fairly low takeup again (GBP1.5bln), while appearances by Ramsden and Pill brought little new.
  • BTP spreads widened as Reuters reported the ECB saw no need to activate TPI to cap Italian yields.

Closing Yields / 10-Yr Periphery EGB Spreads To Germany

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German bonds outperformed through the 10Y segment while the UK long end outperformed Thursday.

  • High German state inflation triggered Bund losses early, which carried through to on the national September CPI release in the afternoon coming in at 10% Y/Y vs expectations of 9.5% coming into the session.
  • Several ECB speakers reiterated that a 75bp hike was likely in October, though the terminal rate dipped 3bp to the lowest since Sep 23 under 2.90% and Schatz outperformed.
  • Long-end Gilt yields fell sharply alongside a GBP rebound on news that the OBR could get a full fiscal forecast by end-Oct. The BoE's bond buying op saw fairly low takeup again (GBP1.5bln), while appearances by Ramsden and Pill brought little new.
  • BTP spreads widened as Reuters reported the ECB saw no need to activate TPI to cap Italian yields.

Closing Yields / 10-Yr Periphery EGB Spreads To Germany

Keep reading...Show less